Fitch downgrades Braskem

Fitch Ratings said it downgraded Braskem SA's local- and foreign-currency issuer default ratings to BB+ from BBB-, Braskem America Finance Co.'s senior unsecured long-term issue ratings to BB+ from BBB- and Braskem Netherlands Finance BV's senior unsecured long-term issue rating and subordinated long-term issue rating to BB+ from BBB- and to BB- from BB, respectively.

The agency also placed their ratings on rating watch negative.

“The downgrade and rating watch negative reflect the increase in environmental risks and new claims of R$1 billion ($200 million) associated with the possible collapse of a salt mine in the context of the geological event in Alagoas, which could worsen the company's cash flow profile. Fitch expects that FCF will be negative for a longer period than expected, while the company remains exposed to a prolonged downturn in the petrochemical sector, all of which resulted in material increase to net debt,” the agency said in a press release.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.